Swarming Foreign Small Vehicles Challenge Local Brands

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Ford has confirmed that it will comprehensively launch lowcost small vehicles in China in the second half of 2014. Prior to that， General Motors （GM） already introduced the plan of bringing its new Onix， a small vehicle of Chevrolet into China. Volkswagen also plans to introduce its A00-level small car into China in two years.

For long， the Chinese market of small/tiny vehicles with low prices is low is taken by the local automobile brands of China. But the fact that foreign automakers are going to bring more and more small vehicles into China， which is definitely a threat to local automakers.

The Chinese automobile brands have been underperforming in the middle- and high-end vehicle market and have to rely on the market of small/tiny vehicles. If their advantages in that sector are overthrown by the foreign brands， what should Chinese auto brands do to deal with the harsher market situation？

The Furious Competition

The small vehicle Ford is going to launch in the Chinese market will make its debut in China in the Beijing Auto Fair in April 2014. The price is expected to be around 50 thousand yuan. According to Ford， this car is exclusive to the Chinese market.

It is known that the new car， which has not been named， is to be built based on Ford’s third generation of Ka platform. Ka is a kind of entry-level vehicle available for the global market. It was launched in the global market in November 2013.

The A00-level vehicle Volkswagen plans to bring into China is called UP. According to Hu Bo， general manger of Volkswagen （China） Distribution Co.， Ltd， said that “the company is making investigations to see whether UP can win the favor of Chinese consumers”. Since UP has the electric version， Volkswagen is thinking of bringing into China as well as a supporting item. In Hu Bo’s opinion， there is still room in the small vehicle market for more brands. Volkswagen wants to establish UP as a kind of car advocating a new lifestyle with a competitive price.

Audi also announced in November that it would launch a new small ve- hicle in 2015. The new car is going to be based on UP and might be named Audi A0. The price is likely to be 112.5 thousand yuan per unit in China. Audi’s German peer BMW also had the plan of localizing the production of MINI in China. As reported by Inautonews， the plant of BMW in Shenyang is going produce new MINI cars in 2015. Presently， BMW is planning to improve the production capacity in China to accommodate the small vehicles of the German company.